THE manufacturing sector is broadly split into three different sub-sectors namely, Engineering with a particular focus on aerospace, General Manufacturing and Food and Drink. Overall these sub-sectors are holding up well and businesses have been able to retain their workforce thanks mainly to improved trading conditions towards the end of 2009. 

If the aerospace sector is to realise the growth potential then businesses need to continue to modernise and change working practices. Only by doing this will they be able to align themselves to the industry primes (Rolls Royce, Airbus and BAe Systems) who dictate the allocation of work within their supply chains.

The work of the IOM Aerospace Cluster (IOMAC) is therefore very significant in driving a strategy for the future which includes the closer involvement of Government in creating an environment for the sector to succeed.

In terms of new opportunities the emergence of Unmanned Air Vehicles and Systems work is growing into a more mature opportunity as is a joint approach to design and manufactured solutions which is being led by the local design company Assystems (IOM) Ltd. 

At Swagelok Limited, which operates as part of a larger US privately owned group, the balance of customers between oil & gas and aerospace has buffered the impact of a 40% reduction in their aerospace orders. 2009 turnover and profit were both strong and employment remained constant despite the harsh economic conditions. 2010 has seen some initial sales recovery and they are now recruiting again for skilled people to enable them to meet increasing demand. They have put considerable effort into leadership training in 2009 and this will continue throughout 2010 with a view to long term gains. 

At Ronaldsway Aircraft Company Ltd the programme of capital investment and investment in the future of the workforce has grown their apprentice activity. They have also been successful in attracting a graduate engineer and aim to recruit two or three graduates. They have supported numerous school and higher education placement students during the last year to promote the business to potential future employees. 

The engineering/aerospace sector held another successful collaborative stand at this year’s Careers exhibition in March at the Villa Marina. The display showcased the job opportunities available in the sector and gave visitors the chance to speak with existing apprentices and HR staff from a broad range of companies. Once again there was an opportunity to view a multimedia presentation in the Broadway Cinema which animated the exciting work being carried out in manufacturing across the Island and both areas were well received and attended.       

In the Food and Drink sub-sector the market is expected to return to normal levels this year with commodity prices remaining high, providing a good basis for profitability across the sector. There are however significant challenges facing some of the manufacturers and further investment will be needed to capitalise on the opportunities in the sales of premium products and a move away from traditional methods to more flexible manufacturing systems.

In general manufacturing businesses are forecasting an increase in demand on 2009 levels with confidence up. For example, at Strix Ltd there is strong demand for their new technologies which will counteract the low-end price sensitive surge they saw in 2009.

The consumer appliance market appears to have made a recovery and stabilised worldwide, offering good growth expansion capability. They will continue to develop the Headquarters at Ronaldsway, as the importance of R&D and engineering strength becomes clear. This is an area where they need to add additional resource and further develop as it represents the future direction of the company.

In January 2010, Strix Ltd won a major lawsuit in China, against two Intellectual Property violators. Substantial damages were awarded to Strix. As a result Strix received extensive media coverage worldwide, including TV appearances on CNBC, as well as key front page news reporting on the Financial Times, The Telegraph, the South China Morning Post and the Australian.

At CVI Melles Griot Tech Optics 2010 started well with business above forecast and sales up by over 20% compared to the same period last year. Likewise, order intake levels are 35% up which bodes well for the future.

Outlook

Medium to long term growth is still forecast to be achievable among the leading players in the aerospace sector which covers 16 companies and 1000 employees.

The IOMAC businesses have indicated that with appropriate support from Government they can in the next five years double the turnover of the Cluster members and create up to 200 extra skilled jobs. 

The formal arrangement with the North West Aerospace Alliance (NWAA) has been extended until December 2010. This will facilitate the continuation of some important initiatives which will further strengthen the Cluster’s capability as a group to win collaborative work packages as well as position them as a major element of the global aerospace supply chain.

The very existence of a strong, cohesive cluster has also led to some excellent inward investment leads from UK aerospace and hi-tech firms which it is hoped can be attracted to set up on the Island in the months ahead, creating new jobs and adding to the diversity and strength of the existing sector.